Damien Hirst: 'I still believe art is more powerful than money'

Damien Hirst has gone from mouthy YBA to global brand over the past 25 years – and become the world's richest living artist on the way. Here he talks about money, mortality and his first retrospective in Britain

Damien Hirst photographed by Pal Hansen for the Observer at his London HQ Science Ltd: 'I still believe art is more important than money.' Photograph: Pal Hansen for the Observer

When Damien Hirst was looking though his archive recently, in preparation for his forthcoming retrospective at Tate Modern, he came across some film footage of an interview he did with David Bowie in the Gagosian Gallery in New York in 1996. "I'm sitting on a big ashtray talking bollocks," says Hirst, laughing. "At one point, Bowie says, 'So what about a big Tate gallery show, then?' And I say, 'No way. Museums are for dead artists. I'd never show my work in the Tate. You'd never get me in that place.'"

He grins ruefully and shakes his head. "I was watching it and thinking, 'Jesus Christ, how things change.' Suddenly, I'm 46 and I'm having what they call a mid-career retrospective. It doesn't seem right somehow."

We are seated on a sofa beneath a big blue Francis Bacon in an expansive first-floor room in Science Ltd, Hirst's central London HQ. It is a vast building on several storeys, and it contains more contemporary art than many medium-sized galleries. There are pieces by Jeff Koons, Richard Prince, Sarah Lucas and, of course, several spin and spot paintings, and steel and glass medicine cabinets by the man himself. Hirst's Prada loafers are on the floor in front of us, but his signature tinted glasses are nowhere to be seen. He looks stockier than the last time I saw him, just over two years ago, and a bit quieter, more reflective. "It's mortality, mate," he says. "My eldest boy, Connor, is 16. A few of my friends have died. I'm getting older. I'm not the mad bastard shouting at the world any more."

But you're only 46, I say; it's not as if the reaper has you in his sights. "I know, I know, but it's more that realisation that you're not young any more. I've always thought, 'I don't want to look back. Ever.' I think I was obsessed with the new. That's changed."

A mid-career retrospective will do that, I say, teasingly. "Maybe," he says. "But I think it's more that when you're young, you're invincible, you're immortal – or at least you think you are. The possibilities are limitless, you're inventing the future. Then you get older and suddenly you have a history. It's fixed. You can't change anything. I find that a bit disturbing, to be honest."

The exhibition in question, simply entitled Damien Hirst, will "be a map of my life as an artist, not a greatest hits". It will include most of the greatest hits, though, as well as some not so well-known early work. "There's the painted boxes and boards that I put in Freeze [the groundbreaking show Hirst curated in 1988], from when I wanted to be the new Kurt Schwitters. And there's stuff from my student days at Goldsmiths – gloss-painted frying pans I hung on the wall. Embarrassing stuff like that."

It was Nick Serota, director of Tate, who also insisted that Hirst show the early work, as well as the first piece from every series he has made ever since. "The first spot painting, the first spin painting, the first vitrine, the first medicine cabinet. They're all in there, for better or worse," says Hirst. He then relates an anecdote that illustrates both his cavalier attitude to his work and the weight the work carries. It concerns an early spot painting, executed by Hirst himself, rather than (as is the case with the 1,500-strong series that followed) one of his production team.

"I showed Nick a photo of it and he wanted it in the show. It's all drips and splats. Terrible, really. When I moved down to Devon, I stuck it outside behind a barn. Millicent [Wilner] from Gagosian came down to visit and she was freaking out: 'Why have you put it there? In the rain! Jesus Christ, Damien!' It was like gold because it was me, but, really, it's shit."

Is he happy it's in the show, now? "I am, yes. It tells part of the story of my last 25 years as an artist. It's important on that level. It says that I didn't just arrive on the planet going 'Fuck you' to everybody, which is what a lot of people seem to think."

Damien Hirst looks back. Photograph: Pal Hansen for the Observer

The "fuck you" work is there in full force, too, though. There's the famous shark in formaldehyde, entitled with typical Hirstian extravagance The Physical Impossibility of Death in the Mind of Someone Living (1991) and described in the catalogue as "one of the most iconic images of late 20th-century art". There's Mother and Child Divided (1993), a bisected cow and calf suspended in four tanks, and the mythical bestiary that is the collection Beautiful Inside My Head Forever (2008), which includes a zebra, a unicorn and a golden calf.

There are pristine steel and glass cabinets full of neatly arranged pills, and evil-looking black paintings made of thousands of flies congealed in paint. There are spin paintings with and without human skulls at their centre, and spot paintings that move between the vibrant and the purely ambient. There are more flies, live ones, hatched from maggots and feeding off a severed cow's head in a vitrine, and butterflies, pinned and painted and pressed on canvas, and a single white dove suspended in mid-flight above a human skull. Life and death, beauty and ugliness, the sacred and the profane; all the big Hirstian statements that have appalled some critics with their supposed obviousness, but have also dragged conceptualism from the margins of the art world into the mainstream.

Outside Tate Modern will stand Hymn (1999), Hirst's monumental take on a child's educational figure, complete with exposed stomach organs. Inside, in the massive Turbine Hall, flanked by security guards, will sit a relatively tiny piece entitled For the Love of God (2007), the most expensive work of art ever created in terms of its materials: a human skull cast in platinum and encased in diamonds. A modern vanitas piece about death and money, but mostly about money.

"Putting the show together," says Hirst, "was like a big 180-degree turn for me. I'm looking back at all this work and trying to make sense of it. Some of it is great, and some of it is unrealised and didn't make it in there, and some of it is just shit. It's 25 bloody years of work and, of course, I'm proud of it, proud that I put the effort in, but there's also one part of me going, 'How did that happen?'"

How, indeed? It is a question that exercises the minds of his many detractors in the art world: how did a mouthy, working-class lad from Leeds, with hooligan tendencies, become the biggest – and the richest – artist on the planet? (In the Sunday Times Rich List of 2010, Hirst's wealth was estimated at £215m.) The answer is long and complex, and has much to do with the radical shifts in culture that have occurred over the past 25 years or so, both in Britain and the world: the unstoppable rise of art as commodity and the successful artist as a brand; the ascendancy of a post-Thatcher generation of Young British Artists (YBAs) who set out, unapologetically, to make shock-art that also made money; the attendant rise of uber-dealers such as Jay Jopling in London and Larry Gagosian in New York; and the birth of a new kind of gallery culture, in which the blockbuster show rules and merchandising is a lucrative sideline.

At the centre of this ultra-commodified art world stands Damien Hirst, art superstar: the richest, loudest, biggest YBA of all. Except that, no longer young, he seems – at the very moment when his canonisation by the art establishment is complete – to be in a long period of transition. When I last spoke to him, in September 2009, in his vast studio near Stroud, Gloucestershire, it was exactly a year after the astounding success of Beautiful Inside My Head Forever, his record-breaking Sotheby's auction of 2008. Back then, just before the world markets tumbled, Hirst made headlines by bypassing his dealers, Jopling and Gagosian, altogether, and taking more than £111m in sales in two days of often-frenzied bidding. Right on the cusp of the recession, the Sotheby's auction was a pivotal moment for Hirst – a grand farewell, he told me, to the "big work" he had been making for years. He also told me then that conceptualism was "a total dead end" and said: "You spend 20 years celebrating your immortality, and then you realise that's not what it's about."

Since then, he has been relatively quiet on the creative (if not the commercial) front, working mainly on his own paintings: that is, canvases on which he, and he alone, applies the paint. Many of them, including a series made after the suicide of his friend Angus Fairhurst in March 2008, were completed in a room in Claridge's that his good friend Paddy McKillen (co-owner of the hotel) loaned him rent-free, in return for some paintings that now decorate the Connaught, another of McKillen's London hotels. An exhibition of that work, No Love Lost, opened at the Wallace Collection in London in October 2009 to uniformly murderous reviews, the late art critic Tom Lubbock comparing Hirst to "a not very promising first-year art student".

Undaunted, Hirst has continued to paint, and when I travelled down to his country home in deepest Devon a few weeks ago, he showed me briefly around his garden shed, where a paint-splattered stuffed bear stood sentinel over a group of partially completed canvases, featuring brightly coloured parrots in lush landscapes and a single big painting of a human head in a wash of what you might call Bacon blue. A few stuffed parrots stood on perches in the centre of the cluttered room, bright yellow and green, as if staring at their painted selves. "When all else fails," Hirst quipped, "get yourself a few dead parrots." It all seemed a long way from a giant blue shark in a tank of formaldehyde. "I've spent a long time avoiding painting and dealing with it from a distance," he said. "But as I get older I'm more comfortable with it."

Damien Hirst, circa 1993. Photograph: Gemma Levine/Getty Images

The house in Devon, where Hirst currently lives with his wife, Maia Norman, and their three children, is one of several properties he owns. He also has a stately home, Toddington Manor, in Gloucestershire, that will one day house a collection of his own work. Near Stroud, he has another house with a vast studio attached, where, not that long ago, many of his 150-strong team of assistants laboured over his serial works: the spot paintings, spin paintings, cabinets and vitrines. He has a houseboat in Chelsea, a house in Thailand, where he spent Christmas, and another in Mexico, although he hasn't been there for a while because "it's a bit wild west out there at the moment".

In London, as well as Science, his organisational hub, he also owns a big chunk of Newport Street in Lambeth, which is currently being turned into a new gallery that will open in 2014 and house his extensive collection of contemporary art by the likes of Bacon, Koons, Murakami, Richard Prince, Sarah Lucas and even Banksy – "We do these collaborations with my spots. I got one from him recently and he'd written all over it in big black letters: Sorry, The Lifestyle You Ordered Is Out of Stock."

Over lunch in Hirst's quayside restaurant in Ilfracombe, beneath a pristine glass cabinet full of pills, I ask him if it was always his motivation to be the biggest, the most successful? "I always wanted to be bigger, but not biggest. Even as a kid in drawing class, I had real ambition. I wanted to be the best in the class but there was always some other feller who was better; so I thought, 'It can't be about being the best, it has to be about the drawing itself, what you do with it.' That's kind of stuck with me. Being best is a false goal, you have to measure success on your own terms."

With Damien Hirst, though, it aways seems to come down to three things: art, ambition and money, though not necessarily in that order. For that reason, as curator Ann Gallagher asserts in her catalogue introduction to the Tate Modern show: "Like no other artist of his generation, Damien Hirst has permeated the cultural consciousness of our times." What that says about us – and about Hirst – is a matter of some debate. Writing recently in the New Yorker on the simultaneous exhibition of all Hirst's 1,500 signature spot paintings in all 11 Gagosian galleries dotted around the globe, the American art critic Peter Schjeldahl wrote: "Hirst will go down in history as a particularly cold-blooded pet of millennial excess wealth. That's not Old Master status, but it's immortality of a sort."

Schjeldahl's critical hauteur is not untypical. The bigger Hirst has become, the more he has become an object of scorn to some serious art critics, a symptom of all that is wrong with contemporary art – and the rampant, market-led capitalism that drives it – as well as an easy target for the flak directed at conceptual art in general. "His work," writes Gallagher, measuredly, "is characterised by its directness as well as its ambition; it is both deadpan and affecting, and it provokes awe and outrage in equal measure."

That, one senses, is exactly how Hirst – mellower these days, but still a northern prole with attitude to burn – likes it. Is there a little part of him that still rejoices in the notion that he is, at heart, a working-class lad who is somehow sticking it to the toffs of the art world? "All of me, I'd say," he replies, cackling. "I mean, I don't fit, do I? I can play the game, but I don't really fit. But you get older and you realise that rebellion doesn't really matter to the market. I kind of learned that early on and I've never forgotten it." How early on? "Well, I remember in about 1989, when I was still an outsider and all my mates were having shows and I wasn't, and it really bugged me. As I was making the fly piece, I was thinking: 'I'm gonna show you. I'm gonna kill you with this one, knock you down dead, and change the world.' And I showed it to a few galleries and they all just turned round and went 'Marvellous, darling.' It didn't have the effect I wanted. It had the opposite effect. I was gutted, in a way."

As a young teenager, Damien Hirst wanted most of all to be a punk, but, as he now puts it, "I was just too young and not angry enough." He remembers his mother melting his one Sex Pistols record to fashion it into a plant holder, and he remembers sneaking out, aged 12 or 13, with his "punk clothes" hidden in a bag, then changing into them when he was out of sight of his house. "I think that attitude crept into my art somehow. I was always looking for ways to sneak stuff into the art world and make it explode in their faces. I was an infiltrator."

Growing up in Leeds, Hirst was a handful for his mother, Mary Brennan, who worked in the local Citizens' Advice Bureau. His punk phase came just after the man he thought was his father walked out on the family when Hirst was 12. He also went through a brief shoplifting phase – he was arrested twice – before he was finally accepted on his second application to study an art foundation course at Jacob Kramer College in Leeds.

As a teenager, he made regular visits to Leeds University's Anatomy Museum to practise drawing, and it was there he found inspiration for his first piece of shock art: a photograph mounted on a steel frame calledWith Dead Head, first exhibited in 1991, in which his 16-year-old self poses, grinning, beside the severed head of a middle-aged man which sits on a mortuary table. It set the scene, if not the tone, for much of what was to follow.

Hirst moved to London in the mid-1980s, and for a time worked on building sites, before being accepted to Goldsmiths in 1986. There, under the tutelage of the artist Michael Craig-Martin, he realised that for the time being, at least, painting was over and that, in contemporary art, the idea was the be all and end all.

"When I arrived there, I was this angry young painter looking at all the conceptual work being made there and dismissing it as pure crap," he says, laughing. "But I got seduced by it. Initially, I was finding pieces of wood, banging them together, and slapping the paint on. It was Rauschenberg, de Kooning and a bit of Schwitters. It had been done to death and they told me so. I went back up to Leeds and I thought, 'OK, I've got to deal with the world I live in – advertising, TV, media. I need to communicate the here and now.' I realised that you couldn't use the tools of yesterday to communicate today's world. Basically, that was the big light that went on in my head."

The rest is art history, though it took a while to be made. You could even say that Hirst the entrepreneur arrived in the public eye before Hirst the artist, when he curated Freeze, a three-part group show of his contemporaries, including Angus Fairhurst, Gary Hume, Michael Landy, Sarah Lucas and Mat Collishaw. It was held in a disused warehouse in London's Docklands in the summer of 1988. The space – and the ambition – was influenced by Charles Saatchi's big gallery in Boundary Road in north London, which opened in the mid-1980s, and initially showed work by pioneering American conceptual artists like Sol LeWitt and Donald Judd, both of whom influenced Hirst.

Despite being a student show, Freeze became the most talked-about art event of the year in London, attracting the attention of both Saatchi and Serota. "It amuses me that so many people think what happened was calculated and cleverly manipulated," Craig-Martin said later, "whereas in fact it was a combination of youthful bravado, innocence, fortunate timing, good luck and, of course, good work."

By the time he left Goldsmiths, Hirst was already making spot paintings and medicine cabinets, both in highly formalised series, and made with the help of a small team of assistants. In 1991, he had his first solo show, In and Out of Love, in a disused shop in central London. His creative imagination had taken another leap. Visitors entered a room in which live butterflies fluttered around, having hatched from canvases embedded with pupae. In another room, dead butterflies were arranged on white canvases placed around a white table with four overflowing ashtrays. All the Hirstian themes were already in place: life and death, beauty and horror, as well as the sense of spectacle that would become the defining aspect of his work.

At a Serpentine gallery show that same year, Hirst met Jay Jopling, who would soon become his dealer. Things moved even faster after that. For a show at the Institute of Contemporary Art in London, Hirst referred in the catalogue to a work in progress that had been commissioned by Charles Saatchi. Entitled The Physical Impossibility of Death in the Mind of a Living Person, it comprised a 14ft-long tiger shark suspended in a tank of formaldehyde. It did not appear in the Saatchi Gallery until 1992, but when it did, it radically changed the world of contemporary art – and the course of Damien Hirst's life.

Having been bought by Saatchi for £50,000, the shark in the formaldehyde-filled vitrine became an icon of contemporary art of the 1990s and perhaps the defining work of what would come to be known as the YBA movement. ("£50,000 For Fish Without Chips" ran a headline in the Sun at the time.) In 2004, the work was sold to an American collector, Steven A Cohen, for a reputed $8m. In 2006, the original shark, having deteriorated, was replaced at Hirst's insistence by a new formaldehyde-injected one, which was then loaned to the Metropolitan Museum of Art in New York. It is that shark that visitors to the Tate Modern show will see. (Both Hirst and Cohen seem unfazed by the big art-historical question of whether a replacement can ever have the import of the original art work. Only time will answer that one.)

"It's what Jeff Koons once referred to as a high-maintenance piece of art," says Hirst, when I ask him about the practicalities of owning a shark in a tank. "The formaldehyde works are guaranteed for 200 years. I would like it to always look as fresh as the day I made it, so part of the contract is: if the glass breaks, we mend it; if the tank gets dirty, we clean it; if the shark rots, we find you a new shark." At 22 tons, it must be a bugger to transport, though? "Not really. The tank and the shark travel separately. Then you clean it and set it up, add the formaldehyde. Basically," he says, without irony, "it's just a big aquarium with a dead fish in it."

Since the shark first swam into the public consciousness in 1992, it has, as Hirst once admitted to me, "been hard to see the art for the dollar signs". His astonishing earning power came to a head with the Sotheby's auction in September 2008, when total sales were 10 times higher than the previous record for work by a single artist. By then, he already held the record for the most money paid in auction for a single work of art by a living European artist, the emir of Qatar having paid £9m the previous year for Lullaby Spring, a steel cabinet containing 6,136 neatly arranged pills.

"Money is massive," says Hirst, when I remind him of the above quote. "I don't think it should ever be the goal, but I had no money as a kid and so I was maybe a bit more motivated than the rest. I used to argue with Angus [Fairhurst] and Sarah [Lucas] about that all the time when we were starting out and struggling. They'd say: 'You're obsessed' and I'd be like, 'It's important.' See, if you don't care about it, often you don't deal with it, then it screws you. I do believe art is more powerful than money, though. I still believe that. And if I ever find out money's more important, I'll knock it on the head."

For all that, Damien Hirst has become for many the epitome of the artist as businessman, entrepreneur and global brand. It is quite a transformation, given that in the wild years of the 1990s, when the YBAs held their own in the drinking, tooting and necking pills stakes with Noel and Liam and the rest of the Britpop crew, Hirst was the loudest, drunkest and, some would say, most objectionable lad of the lot. His bills at the Groucho club, sent monthly to his home address, were legendary, as was his tendency to go out for a drink on a Friday night and get home in the early hours of Sunday morning. He has not touched a drink – nor popped a pill, nor snorted a line – in five years. Does he miss the good old, bad old days?

"Nah. I've done it, man," he says, shaking his head and reaching for a Diet Coke. "I had a beautiful 10 years and then, suddenly, it started to hurt. I couldn't handle the hangovers: waking up in the sticky filth of the Colony Room on the floor; sweating my way though meetings at White Cube; going to meet Larry [Gagosian] on the Anadin, the Nurofen, the Berocca and the Vicks nasal spray, looking like an alcoholic tramp. It wasn't good. I just woke up one day and thought: 'That's it. It's over.' Haven't touched a drop since."

We talk about Louise Bourgeois, whom Hirst visited before her death last year, and I mention her belief that happy people could not make great art. Is he happy? He laughs. "Making art, good art, is always a struggle. It can make you happy when you pull it off. There's no better feeling. It's beauteous. But it's always about hard work and inspiration and sweat and good ideas. I don't believe it's about God-given genius, but I do believe somehow in the magic of art even though I don't want to. I believe in science. I want clear answers." He pauses for a moment. "I want to make art, create objects that will have meaning for ever. It's a big ambition, universal truth, but somebody's gotta do it."

Damien Hirst is at Tate Modern, London SE1 to 9 Sep, sponsored by the Qatar Museums Authority. Observer readers can buy two tickets for the price of one: the offer is valid on full-price tickets only and must be booked before 4 April. Visit tate.org.uk and quote promotional code OBS241